Colorado has taken the lead in the fight to end wage theft in the United States. A new state law has passed that could better protect employees’ income and keep employers accountable.
Once a misdemeanor, wage theft will now be classified as a felony, according to new legislation pushed through on May 16. The Human Right to Work With Dignity Act (HB 1267) says intentional nonpayment of $2,000 or more to an eligible employee will now result in some serious consequences. The law is set to take effect on January 1, 2020.
According to the Colorado Fiscal Institute, more than 500,0000 workers in the state—many of them in the construction industry—lose $750 million a year because of wage theft. Across the country, the U.S. Department of Labor found that the construction and food service industries are hit the hardest with wage theft. In fiscal year 2018, more than 25,000 construction employees were owed nearly $39 million in back pay. Over 41,000 employees in the food service industry were owed $43 million in back pay.
16% of Colorado workers say they’ve been intentionally underpaid
TSheets recently ran a one-question survey, asking “Have you ever been intentionally underpaid by your employer?” While nearly 45% said no, almost 16% said they have. Perhaps even more disheartening is the 22% who said they didn’t know.*
In April 2018, we interviewed David Cooper, a senior economic analyst at the Economic Policy Institute and deputy director of the Economic Analysis and Research Network, about wage theft. The act isn’t always intentional, he says, but when it is, employers tend to think the benefits outweigh the consequences:
“They know that if they do get caught, which is rare, the cost of back wages and possible penalties as well is going to pale in comparison to the savings of cheating their workers if they’re able to do it over a long period of time.”
Of course, with Colorado’s new law, that kind of thinking may change drastically for employers. Accurate time tracking is definitely one way to help reduce wage theft (and time theft!), but there are other things to consider. Here’s what employers should know about avoiding any type of wage and hour trouble.
TSheets curbs wage theft and ensures everyone is paid what they’re owed.